Apple loses its shine in China

[TaiShang]

Then most province in China should have their own home grown companies each. India too.

There were lots of manufacturers, but competition weeds out the weak and market consolidates eventually. This is what is going on in China. At the moment, other than coming up with a very innovative idea, it would be rather difficult to occupy a meaningful space in China's market.

But most countries do not even have popular home grown brands despite of their population size let alone market consolidation.

This is not a bad thing, in fact.

 

[TaiShang]

Baidu indices indicate decline in Apple's China sales
China Daily, July 22, 2016



Baidu Inc released its first indices tracking Chinese consumer behavior and their preferences, indicating a change in employment status of some segments and predicting a drop in sales for Apple Inc.

Based on mapping query data from China's biggest search engine, the indicators utilize the positions of the users, the 25 billion location requests they seek and the wi-fi hotspots they log into across the country. Baidu handles 70 percent to 80 percent of all online searches in China and its mapping service boasts 700 million users.

Wu Haishan, a senior data scientist, said Baidu will start selling more granular data next month which is capable of tracking the performance of specific cities, industries and even brands like Apple. The indicators will be released at the start of each month.

Some economy watchers turn to indices compiled by private sources such as e-commerce leader Alibaba Group Holding Ltd and payments network UnionPay.

"Such analysis should be very useful for the likes of hedge funds, investors or managers," Wu said.

"It will be charged based on volume of the data that you are interested in, for example how many cities, how many provinces or how many firms you are interested in."

In a report demonstrating the potential of the research, Baidu compared the number of people searching its maps for specific Apple stores in China to project the tech giant's revenues.

The 15.4 percent rise in queries during the last quarter of 2015 compared with a 14 percent rise in Apple's sales. When searches fell 24.5 percent in the March quarter, sales for China dropped by 26 percent.

"Based on our analysis of latest data, we project that the Apple's revenue of the second quarter 2016 may be down around 20 percent on a year-over year basis," it said.

Apple, which is expected to report its financial results on Tuesday, declined to comment. China is the company's biggest market outside the United States.

Baidu's report cited a similar practice at Foursquare Labs Inc, which used check-in data to accurately predict a 30 percent decline in same-store sales at Chipotle Mexican Grill Inc following an E. coli outbreak.

Wu said Baidu's data could even be used to actively track the number of people actually watching movies in cinemas, which could help fight box office fraud.

Wu said the employment index showed that hi-tech parks grew at a healthy pace while manufacturing centers showed declines.

 

[TaiShang]

Apple sales down, China's OPPO takes crown in market share
China Daily, July 27, 2016

Apple Inc recorded decline in revenue in the three months that ended in June, the company reported on Tuesday.

Its revenue in the third fiscal quarter reached US$42.36 billion, down 15 percent year on year.

It was the second quarter in a row for the technology giant to see falling sales.

Its net income was US$7.8 billion, down 27 percent. The revenue of its Greater China region, long a source of growth for the company, was US$8.85 billion, down 33 percent year on year.

However, the revenue fall was less steep than Wall Street had expected. The forecast the company gave for fiscal fourth-quarter revenue wasn't as bad as feared either. As a result, shares rose about 7 percent in after-hours trading.

Apple sold 41 million iPhones, a 15 percent drop compared with the same quarter a year ago, and revenue plunged 23 percent. It shipped 4.3 million Macs, down 11 percent and sold 9.9 million iPads, a fall by 9 percent.

According to Counterpoint, China's smartphone maker OPPO beat Apple to take the first spot in June with 22.9 percent of market share.

It's the first time that the domestic phone maker won the race against Apple and Huawei.

Neil Shah with Counterpoint said the fast growth of OPPO contributed to its offline market channels which brought in 70 percent of its sales. Its aggressive sales strategy, the penetration in second- and third-tier cities along with the cutting-edge designs are behind its growth in the past 18 months.

**

When in Mainland China, I realized Oppo was the most aggressive in terms of line marketing and sales. Literally, Oppo has been everywhere.

 

[cirr]

Now if only more of the fair sex would dish their iPhones......

 

[bobsm]

Insufficient innovation blamed for dragging iPhone sales in China
By Yuan Can (People's Daily Online) 16:23, July 27, 2016

Analysts believe that a slow speed of innovation is the root cause for reduced sales of Apple's iPhone in China.
It is an undeniable phenomenon that China's smartphone companies bring new innovations to the market more quickly than American companies do, said Neil Shah, research director for devices and ecosystems at Counterpoint Research in a phone interview with CNBC.

China's homegrown smartphones have created challenges for Apple's iPhone in China. Chinese smartphone maker Oppo topped China’s smartphone market for the first time last month, according to a recent report from Counterpoint. Oppo surpassed Huawei, Apple and Xiaomi with a record 22.9 percent market share, according to a report by Forbes.

"If Apple can't innovate faster in hardware and bring all the features every year or six months like these guys are doing, it will fall behind. By the time Apple has a dual camera, it's almost a year old, which is what most mature smartphone users are realizing," Shah said.

The market share of Apple's iPhone in China dropped to 9 percent in June, showing a year-on-year decrease of 13.2 percent, according to Counterpoint. Analysts said that China's increasingly unenthused market may damage the company's earnings.

According to a report by Reuters, Apple's net profit in the second quarter fell by 27 percent to $7.8 billion. The company's total revenue dropped 14.6 percent in the third quarter, which ended on June 25. Sales in Greater China, once touted as Apple's next growth engine, decreased by 33.1 percent, compared with a 112.4 percent growth in the equivalent quarter last year.

According to a report by CNBC, to accelerate its update period, Apple may be jumping straight to an iPhone 8 in 2017 rather than bringing out an iPhone 7 "S" variant. Furthermore, the report said that Apple is likely to face falling sales unless it can bring out a device to compete with the likes of those by Oppo and Vivo.

http://en.people.cn/n3/2016/0727/c90000-9091854.html

 

[TaiShang]

Insufficient innovation blamed for dragging iPhone sales in China
By Yuan Can (People's Daily Online) 16:23, July 27, 2016

Analysts believe that a slow speed of innovation is the root cause for reduced sales of Apple's iPhone in China.
It is an undeniable phenomenon that China's smartphone companies bring new innovations to the market more quickly than American companies do, said Neil Shah, research director for devices and ecosystems at Counterpoint Research in a phone interview with CNBC.

China's homegrown smartphones have created challenges for Apple's iPhone in China. Chinese smartphone maker Oppo topped China’s smartphone market for the first time last month, according to a recent report from Counterpoint. Oppo surpassed Huawei, Apple and Xiaomi with a record 22.9 percent market share, according to a report by Forbes.

"If Apple can't innovate faster in hardware and bring all the features every year or six months like these guys are doing, it will fall behind. By the time Apple has a dual camera, it's almost a year old, which is what most mature smartphone users are realizing," Shah said.

The market share of Apple's iPhone in China dropped to 9 percent in June, showing a year-on-year decrease of 13.2 percent, according to Counterpoint. Analysts said that China's increasingly unenthused market may damage the company's earnings.

According to a report by Reuters, Apple's net profit in the second quarter fell by 27 percent to $7.8 billion. The company's total revenue dropped 14.6 percent in the third quarter, which ended on June 25. Sales in Greater China, once touted as Apple's next growth engine, decreased by 33.1 percent, compared with a 112.4 percent growth in the equivalent quarter last year.

According to a report by CNBC, to accelerate its update period, Apple may be jumping straight to an iPhone 8 in 2017 rather than bringing out an iPhone 7 "S" variant. Furthermore, the report said that Apple is likely to face falling sales unless it can bring out a device to compete with the likes of those by Oppo and Vivo.

http://en.people.cn/n3/2016/0727/c90000-9091854.html

It seems to me that Apple is heading for dinosaur's fate. It does not matter they come up with Apple 15sxz. The image is not right anymore for new generations. Sort of like Nokia. It is unavoidable.

It is an undeniable phenomenon that China's smartphone companies bring new innovations to the market more quickly than American companies do, said Neil Shah, research director for devices and ecosystems at Counterpoint Research in a phone interview with CNBC.

Well, the new normal. Nothing to be surprised about.

But, shhh, China will collapse. So, don't bother.

 

[Place Of Space]

Quality is good, but price is too high. The Iphone produced in China, assembled in China, marketing promoted in China, the sales price should be the same with Xiaomi.

 

[bobsm]

It seems to me that Apple is heading for dinosaur's fate. It does not matter they come up with Apple 15sxz. The image is not right anymore for new generations. Sort of like Nokia. It is unavoidable.

Agreed.

But, shhh, China will collapse. So, don't bother.

Obviously, reality says otherwise.

 

[cirr]

Bunch of arrogant and insecure money grabbers from the other side of the pond.

 

[cirr]

The marketshare of Apple is at most 5% in June

Owning an Iphone is now considered pure stupid

Strategy Analytics: China Smartphone Shipments Grow 4 Percent in Q2 2016

BOSTON, July 28, 2016 /PRNewswire/ -- According to the latest research from Strategy Analytics, China smartphone shipments grew 4 percent annually to hit 109 million units in Q2 2016. Huawei held on to first position and captured 18 percent smartphone marketshare in China, followed by fast-growing OPPO in second place.

Linda Sui, Director at Strategy Analytics, said, "China smartphone shipments increased 4 percent annually from 105.1 million units in Q2 2015 to 109.0 million in Q2 2016. China returned to growth for the first time in a year due to improved LTE volumes from local brands, robust operator promotions, and a stabilized economic situation. China remains by far the world's largest smartphone market, accounting for nearly 1 in 3 of all 340.4 million smartphones shipped globally this quarter."

Neil Mawston, Executive Director at Strategy Analytics, added, "Huawei shipped 19.1 million smartphones for 18 percent marketshare in China during Q2 2016, growing 15 percent annually from 16.6 million units in Q2 2015. Huawei remains the number one smartphone vendor in China, but this was Huawei's slowest growth rate for two years and the competitive pressure from OPPO, Vivo, LeEco and other rivals is rising fast. OPPO shipped 15.2 million smartphones and captured a record 14 percent marketshare in China in Q2 2016. OPPO's smartphone shipments grew an impressive 108 percent annually. OPPO's R and A series models have been well received in second-tier cities and rural areas of China. OPPO's latest technology innovations, such as ultra-fast battery-charging, have also helped it gain more attention in top-tier cities such as Shanghai."

Woody Oh, Director at Strategy Analytics, added, "Vivo nudged up to third position for the first time ever with 12 percent smartphone marketshare in China during Q2 2016, up significantly from 7 percent a year ago. The success of Vivo lies in good hardware designs, robust product quality, strong retailer penetration, and rising brand awareness among mass-market consumers. In contrast, Xiaomi had a weak quarter, falling 34 percent annually and shipping 12.8 million smartphones in China in Q2 2016. It slipped to fourth position with 12 percent marketshare, down from 19 percent one year ago. Xiaomi is facing tough competition in mid-tier segments from Huawei, Gionee, LeEco and others."

Linda Sui, Director at Strategy Analytics, added, "Apple posted a soft quarter in China, maintaining fifth position with 7 percent smartphone marketshare in Q2 2016, down from 9 percent a year ago. Mixed demand for the iPhone 6s, overstocked volumes in channel from previous quarters, as well as stronger competition from Huawei, OPPO and others were among the key factors for its lackluster performance."

Exhibit 1: China Smartphone Vendor Shipments and Marketshare in Q2 2016 1



China Smartphone Vendor Shipments (Millions of Units)

Q2 '15

Q2 '16

Huawei

16.6

19.1

OPPO

7.3

15.2

Vivo

7.8

13.0

Xiaomi

19.5

12.8

Apple

9.7

7.3

Others

44.2

41.6

Total

105.1

109.0




China Smartphone Vendor Marketshare (%)

Q2 '15

Q2 '16

Huawei

15.8%

17.5%

OPPO

6.9%

13.9%

Vivo

7.4%

11.9%

Xiaomi

18.6%

11.7%

Apple

9.2%

6.7%

Others

42.1%

38.2%

Total

100.0%

100.0%




Total Growth: Year-over-Year (%)

3.0%

3.7%


http://www.prnewswire.com/news-rele...ents-grow-4-percent-in-q2-2016-300306020.html

Source: Strategy Analytics

 

[TaiShang]

The marketshare of Apple is at most 5% in June

Owning an Iphone is now considered pure stupid

Strategy Analytics: China Smartphone Shipments Grow 4 Percent in Q2 2016

BOSTON, July 28, 2016 /PRNewswire/ -- According to the latest research from Strategy Analytics, China smartphone shipments grew 4 percent annually to hit 109 million units in Q2 2016. Huawei held on to first position and captured 18 percent smartphone marketshare in China, followed by fast-growing OPPO in second place.

Linda Sui, Director at Strategy Analytics, said, "China smartphone shipments increased 4 percent annually from 105.1 million units in Q2 2015 to 109.0 million in Q2 2016. China returned to growth for the first time in a year due to improved LTE volumes from local brands, robust operator promotions, and a stabilized economic situation. China remains by far the world's largest smartphone market, accounting for nearly 1 in 3 of all 340.4 million smartphones shipped globally this quarter."

Neil Mawston, Executive Director at Strategy Analytics, added, "Huawei shipped 19.1 million smartphones for 18 percent marketshare in China during Q2 2016, growing 15 percent annually from 16.6 million units in Q2 2015. Huawei remains the number one smartphone vendor in China, but this was Huawei's slowest growth rate for two years and the competitive pressure from OPPO, Vivo, LeEco and other rivals is rising fast. OPPO shipped 15.2 million smartphones and captured a record 14 percent marketshare in China in Q2 2016. OPPO's smartphone shipments grew an impressive 108 percent annually. OPPO's R and A series models have been well received in second-tier cities and rural areas of China. OPPO's latest technology innovations, such as ultra-fast battery-charging, have also helped it gain more attention in top-tier cities such as Shanghai."

Woody Oh, Director at Strategy Analytics, added, "Vivo nudged up to third position for the first time ever with 12 percent smartphone marketshare in China during Q2 2016, up significantly from 7 percent a year ago. The success of Vivo lies in good hardware designs, robust product quality, strong retailer penetration, and rising brand awareness among mass-market consumers. In contrast, Xiaomi had a weak quarter, falling 34 percent annually and shipping 12.8 million smartphones in China in Q2 2016. It slipped to fourth position with 12 percent marketshare, down from 19 percent one year ago. Xiaomi is facing tough competition in mid-tier segments from Huawei, Gionee, LeEco and others."

Linda Sui, Director at Strategy Analytics, added, "Apple posted a soft quarter in China, maintaining fifth position with 7 percent smartphone marketshare in Q2 2016, down from 9 percent a year ago. Mixed demand for the iPhone 6s, overstocked volumes in channel from previous quarters, as well as stronger competition from Huawei, OPPO and others were among the key factors for its lackluster performance."

Exhibit 1: China Smartphone Vendor Shipments and Marketshare in Q2 2016 1



China Smartphone Vendor Shipments (Millions of Units)

Q2 '15

Q2 '16

Huawei

16.6

19.1

OPPO

7.3

15.2

Vivo

7.8

13.0

Xiaomi

19.5

12.8

Apple

9.7

7.3

Others

44.2

41.6

Total

105.1

109.0




China Smartphone Vendor Marketshare (%)

Q2 '15

Q2 '16

Huawei

15.8%

17.5%

OPPO

6.9%

13.9%

Vivo

7.4%

11.9%

Xiaomi

18.6%

11.7%

Apple

9.2%

6.7%

Others

42.1%

38.2%

Total

100.0%

100.0%




Total Growth: Year-over-Year (%)

3.0%

3.7%


http://www.prnewswire.com/news-rele...ents-grow-4-percent-in-q2-2016-300306020.html

Source: Strategy Analytics

Apple is now boring. Not because they suddenly became less of a quality phone.

But they became boring. Lose this appeal, and you are on the way of becoming the next HTC.

Future is Huawei, Oppo and Xiaomi.

 

[OrionHunter]

Quality is good, but price is too high. The Iphone produced in China, assembled in China, marketing promoted in China, the sales price should be the same with Xiaomi.

Now they're shifting base to India because the competition with cheaper Chinese phones has got them screwed.

 

[Max Pain]

Now they're shifting base to India because the competition with cheaper Chinese phones has got them screwed.

There are cheaper Chinese phones in India too,
wont be easy in India either.
but still Apple is held with good regard in this part of the world.
people pay a lot for it.

 

[AndrewJin]

Now they're shifting base to India because the competition with cheaper Chinese phones has got them screwed.

I'm not sure how many Indian consumer can afford phones with a price more than $300

Until now, China is still the most important market for Apple outside their home turf.
It will remain so, unless there is some significant increase of average Indians' affordability.

But it's a good thing Indian factories can assemble more phones for the local market.
It's a win-win for both India, and East Asia's supply chain.
Especially for East Asia, need less labor in assembling but earn way more profit in components.

https://www.apple.com/euro/supplier-responsibility/b/generic/pdf/Apple_Supplier_List_2015.pdf

Supply chain in East Asia- ASEAN
Stronger and more efficient then ever

 

[TaiShang]

Looks like India has yet to receive investment from Apple. It is an uphill battle because there is other cheap labor destinations with more qualified workforce such as Vietnam and Thailand.